©2020 WorldatWork

©2020 WorldatWork

Sales Compensation in a COVID-19 World

April 2020

©2020 WorldatWork

1

Content Directory

Methodology……………………………………………………….. 2

Key Findings…………………………………………………………. 3

Comprehensive Results…………………………………........ 4

Respondent Profile………………………………………......... 19

Contact Information…………………………………………….. 21

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2

Methodology

Design

Collect

Analyze

WorldatWork, in partnership with SalesGlobe, conducted a rapid response survey about sales compensation in a COVID-19 world.

We invited members and clients to participate in the survey via email and LinkedIn, resulting in a final sample of 372 respondents.

Results are generally representative of mid-sized and enterprise organizations, and the overall study has a 5% margin of error. Sample sizes vary by question and by respondent group. Please note that statistical reliability will fluctuate based on sample sizes.

Differences by company size and industry have been notated throughout the report.

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Only 36% of organizations have a plan to address sales compensation.

Over half of organizations have defined to the sales team how to engage with customers.

3

Key Findings

To back up these assurances, leadership has moderate to high trust, strongest in smaller companies.

While almost half have assured the sales team of compensation action.

The top considerations are quotas, performance measures, and thresholds.

Of which, the most implemented so far are performance measure changes and and quota adjustments.

Organizations have shifted from selling to helping and refocusing on less-impacted segments.

Most expect lower performance this year and nearly half plan to minimize compensation impact.

Customers

Communication

Compensation

COVID-19 has put sales organizations in fast response mode, looking at compensation and beyond for answers.

Most organizations are communicating proactively butonly 15% have communicated compensation actions.

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4

Most organizations communicate proactively, though smaller orgs are more proactive

55%

27%

11%

3% 4%

Acting proactively andclearly communicatingdirection and actions

Providing satisfactorycommunications inresponse to sales

organization needs

Largely reactive as theorganization demands

Communicatingminimally with the sales

organization

No communications tothe sales organization

n = 372

What best describes how your sales leadership team is managing communications to the sales team relative to the COVID-19 crisis?

58%

52%

Under 1k Employees Over 1k Employees

Proactive Communication by Company Size

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5

The majority of organizations have provided defined plans with customer messaging

15%

11%

14%

24%

25%

55%

No update to plan or direction

An updated plan that defines what to sell in terms ofupdated offers, services, pricing or terms

An updated general plan that must be interpreted bythe sales organization

An updated specific plan with clear actions

An updated plan that defines how sales peopleshould work and sell day-to-day

An updated plan that defines how to engage withcustomers and which messages to communicate

n = 261

How has your sales leadership team provided a plan to the sales organization about how the sales team should navigate as sellers in the current environment?

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Only 15% have communicated immediate compensation action and 5% quota action

5%

15%

36%

43%

Leadership communicated immediate actions thatwould be taken on quotas

Leadership communicated immediate actions thatwould be taken on the plan

Leadership did not communicate a plan or actionson the compensation program

Leadership assured the sales team thatcompensation would be addressed, with an

approach to be determined or announced later

n = 261

How has your sales leadership team communicated to the sales organization about how their incentive plan may be impacted in the current environment?

Key Observations

• Financial services leadership are more likely to have already communicated actions (22%)

• Consulting is least likely to have communicated actions (50%)

• Almost half have addressed sales team concerns

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Most organizations are communicating once every few days or more frequently

3%

9%

3%

22%

30%

7%

26%

Not currentlysending

SporadicallyLess than onceper week

Once a weekEvery few daysEvery otherday

Daily

n = 250

How frequently is your sales leadership team communicating to the sales organization regarding their COVID-19 actions and plan?

16%

27%

Under 1k Employees Over 1k Employees

Daily Communication by Company Size

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Email is still the most common method with online meetings close behind

7%9%14%15%

25%

37%

66%

88%

OtherSales systemTextElectronicnewsletter

IntranetPlatformcollaboration

tools

Virtual onlinemeetings

Email

n = 247

What communication delivery methods is your sales leadership team using to communicate with the sales organization? Please select all that apply.

Key Observations

• The majority of respondents are using 2-3 methods on average

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9

Leadership has a moderate to high degree of trust, which is highest in smaller organizations

1%3%

54%

42%

NoneLowModerateHigh

n = 245

How would you rate the degree of trust the sales organization has that leadership will treat the organization fairly with sales compensation in light of the current conditions?

52%38%

Under 1k Employees Over 1k Employees

High Trust by Company Size

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Most organizations have not created a committee to focus on sales comp actions

Yes33%

No51%

Not sure16%

n = 239

Has your organization formed a committee focused on sales compensation actions?

24%

38%

Under 1k Employees Over 1k Employees

Committee Formation by Company Size

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11

Only 36% of organizations have a plan to address sales compensation

16%

20%

34%

49%

We are implementing a plan to address salescompensation

We have a plan on how to address salescompensation

We are triaging based on immediate salescompensation needs

We are developing a plan on how to address salescompensation

n = 226

At what stage of planning or implementing are you with sales compensation changes? Please select all that apply.

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12

The actions most considered are adjusting quotas, performance measures, and thresholds

6%

10%

11%

14%

18%

22%

36%

44%

46%

Milestone bonuses

Increased compensation kickers

Using recoverable draws

Shifting out quota seasonality to later in the year

Using non-recoverable draws

Sales bonuses

Lower plan tresholds

Adjusting performance measures

Adjusting quotas

n = 221

What sales compensation actions are being CONSIDERED in response to the COVID-19 crisis? Please select all that apply.

Key Observations

• On average, organizations are considering 2-3 actions

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13

Organizations with actions implemented are focused on adjusting performance measures and quotas

5%

6%

7%

9%

11%

13%

19%

24%

27%

Milestone bonuses

Increased compensation kickers

Using recoverable draws

Shifting out quota seasonality to later in the year

Sales bonuses

Using non-recoverable draws

Lower plan tresholds

Adjusting quotas

Adjusting performance measures

n = 180

What sales compensation actions are being IMPLEMENTED in response to the COVID-19 crisis? Please select all that apply.

Key Observations

• On average, organizations have only implemented one action so far

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14

Organizations have shifted from selling to helping and advising

20%24%

27%31%31%

35%

46%

Changing oursales process

Realigningaccount

assignments tobetter match

sellers toopportunities

Conducting rapidaccount planning

for strategicaccounts

Modifying ourvalue proposition

to customers

Implementingchanges in offers,services, pricing

or terms

Refocusing onsegments or

industries lessaffected by the

crisis

Shifting fromselling to helpingand becoming atrusted advisor

n = 196

What sales strategies are being considered or implemented in response to the COVID-19 crisis? Please select all that apply.

Key Observations

• On average, organizations are considering 2-3 actions

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15

Most organizations are expecting to perform lower to plan this year

n = 210

What do you BELIEVE will be the impact to the sales compensation program as a result of the COVID-19 crisis? Please select all that apply.

The sales organization will perform lower to plan this year and the company will do its best to minimize the compensation impact to the team

43%

The sales organization will perform lower to plan this year and earn less 38%

The sales organization will recover in the second half of the year and regain a moderate amount of compensation

35%

We will likely rethink our sales compensation program for 2021 22%

We will likely return to our current compensation program later in the year 21%

We will likely retain the plan changes we've made for this crisis for the rest of this year

15%

We will likely continue our current compensation program for 2020 15%

We will likely retain the plan changes we've made for this crisis for 2021 3%

Key Observations

• About one third are optimistic on recovering sales and compensation

• Less than a quarter plan to rethink their comp plans for 2021

• Consulting expects to perform lower to plan and earning less this year (52%)

• Financial services expectsto perform lower to plan and do their best to minimize the compensation impact (61%)

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Nearly all employers are providing support to help associates adjust during lockdown

Yes94%

No3%

Not sure3%

n = 208

Is your organization providing support to employees on how to adjust to an environment of self-isolation and social distancing?

88%

97%

Under 1k Employees Over 1k Employees

% Providing by Company Size

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Technology is being leveraged by nearly all organizations to maintain team effectiveness

5%

21%

36%

49%

94%

OtherProviding updatedsales playbooks

Training the salesteam

Coaching the salesteam individually

Enabling employeeswith the necessary

technology

n = 203

How is your organization helping the sales team work effectively in this environment? Please select all that apply.

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Live forums and webinars are considered the most valuable sources of strategy information

n = 198

Please rank the most valuable way for you to learn about current practices other companies and the market are using to address the COVID-19 crisis from a sales and compensation

perspective.

1

2

3

4

6

5

Information from the business press 22%

Information from news media 7%

Information from internet searches 3%

Information from web communities, blogs, or chat boards 7%

Information from live forums that include peer companies and leaders 34%

Information from webinars 29%

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Company Sector

47%45%

4%5%

Private, publicly traded Private, privately-held Government/ Publicsector

Nonprofit/ Not-for-profit

Your organization is:

n = 193

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Company Industry and Size

8%

15%

43%

19%

15%

Fewer than 100 employees

100 to 999

1,000 to 9,999

10,000 to 39,999

40,000 or more employees

Under which industry does your organization fall?

How many full-time equivalent (FTE) employees does your organization have?

14%

5%

8%

10%

11%

12%

16%

17%

Other

Distribution/wholesale

Communications/media

Information technology

Consulting/professional services

Financial services

Healthcare/pharma

Manufacturing

Only industries with at least 5% of responding organizations are listed here.

n = 193

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Contact Us

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Telephone770-337-9897

Emailmark.donnolo@salesglobe.commichelle.seger@salesglobe.com

Websitesalesglobe.comsalesglobe.com/covid-19-rapid-response/